United States District Court, W.D. Virginia, Lynchburg Division
K. MOON, UNITED STATES DISTRICT JUDGE
matter is before the Court upon Defendant’s motion to
dismiss. Plaintiff Robert Gammon (“Gammon”) filed
this action against State Farm Mutual Automobile Insurance
Company (“State Farm”) for allegedly breaching a
purported contract between the parties. Additionally, Gammon
avers that State Farm is liable for intentional infliction of
emotional distress and constructive fraud. Because Gammon has
failed state a plausible claim of breach of contract and
intentional infliction of emotional distress, I will grant
State Farm’s motion dismissing these claims. Also,
because Gammon has failed to meet the pleading requirements
for fraud under Rule 9(b) of the Federal Rules of Civil
Procedure, I will dismiss his constructive fraud claim, but
grant Gammon leave to amend the pleading deficiencies.
State Farm is a corporation in the business of selling
insurance. Am. Compl. ¶ 2. As part of its operations,
State Farm recruits and interviews candidates to run
independent agencies that sell exclusively State Farm
insurance products. Candidates are required to secure
licenses and governmental approvals in order to operate these
agencies. Id. ¶¶ 8-9.
Robert Gammon alleges the following in his Amended Complaint.
Gammon applied to run an independent agency, and in so doing,
disclosed to State Farm his criminal background, which
included a twenty-five-year-old felony marijuana conviction.
State Farm assured Gammon that this felony conviction would
not burden his effort to operate an agency. Id.
15, 2014, State Farm stated that, conditioned upon Gammon
securing all required licenses and approvals, the parties
would sign an agency contract and, in the meantime, State
Farm would provide Gammon with an interim salary of $70,
038.35. Once all licenses were obtained and the contract was
signed, Gammon was to operate an independent agency in
Lynchburg, Virginia. Id. ¶¶ 14-15. State
Farm provided Gammon with an August 4, 2014, start date.
Gammon agreed with State Farm’s proposal, and
thereafter quit his job of seventeen years. Id.
¶¶ 19, 21.
further alleges that he was required by State Farm to secure
approval from the Federal Deposit Insurance Corporation
(“FDIC”) in order to operate an agency.
Id. ¶ 22. This process involved a background
check, but State Farm had the option of obtaining a temporary
waiver from this practice. According to Gammon’s
Amended Complaint, State Farm did not seek such a waiver.
Id. ¶ 24. Gammon himself began the process of
seeking a waiver in August 2014. On or about October 9, 2014,
State Farm asserted that Gammon was unable to secure approval
from the FDIC, and thus refused to perform on its earlier
proposal. Id. ¶¶ 25-26. Accordingly,
Gammon lost employment, and was subsequently unemployed for
eleven months. Id. ¶ 29.
evaluating a Rule 12(b)(6) motion to dismiss for failure to
state a claim, the Court must accept as true all well-pleaded
allegations. See Vitol, S.A. v. Primerose Shipping
Co., 708 F.3d 527, 539 (4th Cir. 2013); see also
Erickson v. Pardus, 551 U.S. 89, 94 (2007). “While
a complaint attacked by a Rule 12(b)(6) motion to dismiss
does not need detailed factual allegations, a
plaintiff’s obligation to provide the grounds of his
entitlement to relief requires more than labels and
conclusions, and a formulaic recitation of the elements of a
cause of action will not do.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007) (internal citations
and quotation marks omitted). Stated differently, in order to
survive a motion to dismiss, “a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its
face.’” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (quoting Twombly, 550 U.S. at 570).
Breach of Contract
claims that State Farm committed breach of contract when it
declined to provide an independent agency for him to operate.
He asserts that State Farm “refus[ed] to perform on the
parties’ agreement, purportedly terminating
Plaintiff’s employment.” Am. Compl. ¶ 26.
Virginia law, a breach of contract claim requires a showing
of “(1) a legally enforceable obligation of a defendant
to a plaintiff; (2) the defendant's violation or breach
of that obligation; and (3) injury or damage to the plaintiff
caused by the breach of obligation.” Ulloa v. QSP,
Inc., 271 Va. 72, 79 (2006) (quoting Filak v.
George, 267 Va. 612 (2004)).
Gammon has not shown any contractual obligation on ...